Tunnel to Nowhere: New Rail Tunnel At Least a Decade Away

While Democrats and Republicans traded charges yesterday over Gov. Chris Christie's decision to cancel the Access to the Region's Core (ARC) rail tunnel that would have been the nation's largest public works project, the bottom line is clear: No new rail tunnel will be built under the Hudson River for at least a decade, and the new tunnel will end up costing a lot more money when it is finally built.

"Arguing over whether the ARC Tunnel would have cost $11 billion or $14 billion doesn't get us any closer to building the new rail tunnel we need," Thomas Wright, executive director of the non-profit Regional Plan Association, said in frustration yesterday.

He noted that the completion of the much-needed rail tunnel would be 10 years away even if federal, state, and city officials had a plan in place -- which they don't. "Instead of arguing, we should be bringing people together, but that just hasn't been happening."

A report issued by the nonpartisan U.S. General Accounting Office yesterday revived the debate over whether Christie cancelled the ARC project because he was worried that New Jersey would have cover billions of dollars in potential cost overruns or because he could avoid raising the gas tax by using billions of dollars originally earmarked for the tunnel to refinance the state's Transportation Trust Fund, as he did three months later.

"This was the most important transportation project of our time," said U.S. Senator Frank Lautenberg (D-N.J.), who requested the GAO study. "New Jerseyans who commute into New York City already face near daily struggles with an overburdened rail system and jammed highways, bridges, and tunnels. We are at capacity, and our only hope for relief in this decade was ARC. Construction had already started and thousands of workers were about to be hired when the governor killed the project. The future of New Jersey's commuters was sacrificed for the short-term political needs of the governor."

Christie, whose refusal of $3 billion in federal funds for the ARC Tunnel helped make him a national Republican folk hero, spurred GOP gubernatorial candidates to promise to turn down federal money for rail projects in California, Florida, Ohio and Wisconsin. He was still taking political credit for the decision in a speech to the George W. Bush Institute in New York City yesterday.

"I refuse to compromise my principles," Christie said in remarks quoted by the Star-Ledger. "So when they want to build a tunnel to the basement of a Macys and stick the New Jersey taxpayers with a bill of $3 to $5 billion over, no matter how much the administration yells and screams, you have to say no. You have to look them right in the eye, no matter how much they try to vilify you for it, and you have to say no. You have to be willing to say no to those things that compromise your principles."

Wright and Jeff Tittel, director of the Sierra Club of New Jersey, want Christie to start saying "Yes." Both called yesterday for state and federal officials to work together to develop plans for a new rail tunnel to replace the ARC project. Unfortunately, at this point, there is no agreed-upon plan in place, Wright noted.

Lautenberg, who chairs the U.S. Senate Subcommittee on Surface Transportation and has been a staunch advocate of mass-transit projects since he was first elected to the Senate in the 1980s, has negotiated an agreement with Amtrak to take the unusual step of including New Jersey Transit commuter trains in its plans for a New York-New Jersey rail tunnel that it is planning to build. The project would accommodate high-speed passenger trains making runs between Washington and Boston in three hours.

Lautenberg was the chief Capitol Hill advocate for a $15 million planning grant for the Amtrak Gateway Tunnel project in last year's federal budget and is seeking an additional $35 million to complete the initial planning study in this year's federal budget. "High-speed rail would make Philadelphia a sixth borough of New York City," Wright said enthusiastically, "and the inclusion of New Jersey passenger trains is an important addition to the project."

The Amtrak Gateway Tunnel would provide New Jersey Transit with only 65 percent of the additional peak-hour ridership that the ARC project would have delivered, but it would make possible one-seat rides from Bergen and other counties. Currently, only the Morris & Essex Line offers one-seat rides to Manhattan.

"The most important industry of New Jersey is commuting to New York City, so it is critical to New Jersey to get it done and to get it done right." Wright said

Wright noted that Christie said both at his press conference cancelling the ARC project and in a speech to the Alliance for Action last year that construction of a new rail tunnel was important to New Jersey's economic future.

However, the critical question for Gateway, as with ARC, is the funding.

While the Northeast Corridor's Washington-New York City-Boston run is the jewel of the Amtrak system and one of the few lines on which it makes money, Amtrak will not pay the full cost of the Gateway Tunnel if it is going to share the tunnel with New Jersey Transit commuter trains.

Meanwhile, Michael Drewniak, Christie's spokesman, emphasized in an email yesterday that "No matter what projects are proposed or under consideration now or in the future, the governor will not sign New Jersey up for another such project unless there is a truly equitable cost-sharing structure, with participation from all the benefiting parties, including New York."

By "equitable cost-sharing," Christie does not mean allocating New Jersey's share of Port Authority toll revenues to a new rail tunnel that benefits both New York and New Jersey, while New York gets to spend its share on projects that exclusively benefit New York, such as the new Freedom Tower. That is why Christie felt justified in counting the Port Authority's $3 billion planned contribution to the ARC Tunnel as "New Jersey money" rather than a bistate cost share.

"One of the good things about Gateway is that it is largely an Amtrak project because this is a lynchpin of the entire Northeast Corridor," Wright said. "But there are going to be major funding questions, and assuming that we have to come up with complicated State of New Jersey, Port Authority, and other local funding options, then 2022 is probably too ambitious a target date -- we're probably looking later than that."

Wright said the Amtrak Gateway Tunnel is more likely -- and more advantageous for New Jersey -- than the extension of the No. 7 New York City subway line to Secaucus, which New York City Mayor Mike Bloomberg has championed.

"This was described as a cheaper, low-cost way to get under the Hudson, and it did have more capacity to move people than ARC or Gateway," Wright said. "But extending a subway system is not the same as doubling the capacity of New Jersey's rail system. You would just end up with more people driving to Secaucus to get on the train or taking passenger trains to Secaucus to transfer."

However, when asked recently about the prospects for extension of the No. 7 line to Secaucus, New York City's Metropolitan Transportation Authority chairman Joseph Lhota responded, "not in our lifetime."

Wright just hopes that "not in our lifetime" is not the epitaph for the future of all rail passenger tunnels under the Hudson.

"My sense of the Gateway project at this stage is that it is more of a study than a specific project, which is good," he added. "At the Regional Plan Association, we believe we need to do a broader study that looks at all anticipated demand and options, including commuter rail, high-speed rail, ferries, and bus service. We need to do a better job of planning this time, and make sure that New Jersey passenger rail service goes directly to Penn Station."

That was always Tittel's main objection to the ARC project.

"We always believed Gov. Christie cancelled this project to take the money for the Transportation Trust Fund. We have gone from a tunnel to a black hole when it comes to funding," said Tittel, who famously dubbed ARC "the Tunnel to Macy's Basement" when officials decided the subterranean construction work required would be too expensive to run the new lines into Penn Station.

"If the governor was sincere he should have continued to work on the New Jersey side with the federal money. He could have used that time to negotiate with Amtrak and New York to bring the tunnel to Penn Station instead of losing the $3 billion," Tittel said. "A third rail tunnel is needed to improve access to the region's core but it must be done right. It took us 50 years to get to this point; we can't wait another 50 years for an effective solution

Yesterday's 29-page GAO report was cited by Democrats as evidence that Christie intentionally exaggerated the project's potential cost overruns to justify his decision.

Lautenberg noted that Christie cancelled the ARC tunnel, which he had endorsed during his 2009 campaign for governor, even though the GAO concluded that "the projected cost ranges of the project were essentially unchanged between the time Christie took office and when he canceled the project.

Drewniak countered that the GAO report showed that federal cost estimates for the new rail tunnel from Weehawken to the West Side of New York City rose from $7.8 billion in 2007 to between $10.9 billion and $13.7 billion in 2010, not including the $775 million reconstruction of the Portal Bridge leading to the tunnel. "It's clear now more than ever that the federal government has no clue what the actual cost of the tunnel would have been and Gov. Christie was right," Drewniak insisted.

Ironically, tucked into the report is the unmistakable conclusion that it was the Federal Transportation Administration's higher cost projections in August 2010, which provided for contingency overruns, that gave Christie political cover to cancel the project.
New Jersey Transit, which was the general contractor on the ARC Tunnel and is directly under the control of the Christie administration, insisted in its August 18, 2010, response to the new Federal Transportation Administration cost estimates that the tunnel could be built for between $8.7 billion and $10 billion, the GAO report noted.

It was the Christie administration's own cost estimates that Christie attacked publicly as a "fiction" on October 7, 2010, citing a report by an ARC Executive Steering Committee made up of his entire transportation hierarchy -- from NJ Transit chief Jim Weinstein to senior Port Authority of New York and New Jersey and state Department of Transportation officials – whose $11 billion to $14 billion cost estimate was virtually identical to the federal projections.

The GAO report focused not only on cost projections, but also made a clear case for the need for a new rail tunnel, noting that the existing rail tunnels under the Hudson are already at capacity and that the demand for rail ridership from New Jersey to New York City is expected to grow 38 percent by 2030.

Construction of the ARC tunnel would have been completed by 2018, more than doubling capacity for rush hour trains in out and out Manhattan, from 23 trains to 48 trains during peak periods. Five more rail lines would have joined the Morris and Essex Line in offering one-seat service in Manhattan, cutting the number of rail transfers from 32,100 to 1,000 per day and saving commuters 23 minutes in travel time each way.

The project would have eased overcrowding in Penn Station by building a new rail station at 33rd Street and 7th Avenue on the West Side of Manhattan, and it would have generated 5,700 construction jobs and 44,000 permanent jobs, and increased home values in towns that would now have one-seat service to Manhattan, the study noted.

The GAO noted that it delayed its study for six weeks while Christie administration officials negotiated the repayment of $95 million of the $271 million in federal funds already spent planning and digging the entrance to what is now the "tunnel to nowhere" in Weehawken.